Pennsylvania Home Buyer

State College First Time Home Buyer

Nice house with sold signThe State College First Time Home Buyer (FTHB) program offers mortgage and closing cost assistance to both moderate and lower income families; this typically translates into a home at a monthly cost equal to or lower than your current rent. 

Qualifying homebuyers are offered free homebuyer education and budget counseling to help them every step of the way. 

The State College Community Land Trust (SCCLT) and Temporary Housing Foundation, Inc. (HTI) also provide opportunities for homebuyers to purchase a home in the Borough. The SCCLT encourages home ownership by "splitting" the cost of a home. 

Below are qualifying maximum annual incomes for 2013:

Low/Moderate Income
Family Size
1 Member 2 Members 3 Members 4 Members 5 Members
$37,450 $42,800 $48,150 $53,450 $57,750

Middle Income
Family Size
1 Member 2 Members 3 Members 4 Members 5 Members
$53,820 $61,525 $69,230 $76,820 $83,030


What is pmi?

Lenders require a down payment of twenty percent with conventional mortgages. Private mortgage insurance, also known as pmi is a type of insurance that the homebuyer pays when he or she has a down payment of less than 20%. If the homebuyer defaults on the mortgage, the pmi company will pay the difference between the down payment and required 20%. For example, if the sales price of the home is $100,000 and the homebuyer gives the bank a 5% down payment, the mortgage insurance company will “guarantee” the 15% that the buyer was unable or unwilling to pay to the lender. In this example, $15,000 would be paid to the mortgage company if the homebuyer defaults on the mortgage.

Do mortgage companies require flood insurance?

Yes. Mortgage companies and banks will obtain a report from a company that charts homes that are at risk from flooding. The reason is that the mortgage company has the most to lose if the house is lost in a flood. Lenders require flood insurance for houses located in flood plains.

Do student loans affect mortgage qualification?

Yes. Student loans are a debt, just like any other credit obligation. Defaulted student loans are a serious impediment to obtaining a mortgage

Do USDA home loans require mortgage insurance?

Yes. The USDA home loan program requires a lump sum payment at closing, however, the upfront mortgage insurance premium is usually financed with the loan. The USDA also requires small monthly payment that is included with the mortgage payment. The USDA mortgage insurance is not life or disability insurance. The upfront mortgage insurance and monthly payment is used to sustain the USDA home loan program.

How long do mortgage applications take?

Some mortgage applications will only take only 15 minutes, provided you have all the necessary paperwork requested by the loan officer and keep the questions to a minimum. However, the typical loan application takes an hour. Each applicant and application is unique. If you want a fast application, photocopy all your personal papers requested by the loan officer in advance of the mortgage application.

How much down payment is needed to avoid mortgage insurance?

Unfortunately, you cannot avoid mortgage insurance with FHA and USDA home loan . . . even with a 20% down payment. The VA mortgage also requires upfront mortgage insurance regardless of down payment, unless you are a 10% disabled veteran. Conventional mortgages require mortgage insurance if the down payment is less than 20%.

How much does it cost to buy a house in Pennsylvania?

Use the PA mortgage calculator to estimate the down payment, closing costs and monthly payment for FHA, VA, USDA & conventional loans.Closing cost calculator